Ark. Code Ann. » Title 4 Chapter 09
Arkansas Code Annotated

Ark. Code Ann. § 4-9-109 (2026)

Scope

✓ current as of May 2026
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  1. Except as otherwise provided in subsections (c) and (d) of this section, this chapter applies to:
    1. a transaction, regardless of its form, that creates a security interest in personal property or fixtures by contract;
    2. an agricultural lien;
    3. a sale of accounts, chattel paper, payment intangibles, or promissory notes;
    4. a consignment;
    5. a security interest arising under § 4-2-401, § 4-2-505, § 4-2-711(3), or § 4-2A-508(5), as provided in § 4-9-110; and
    6. a security interest arising under § 4-4-210 or § 4-5-118.
  2. The application of this chapter to a security interest in a secured obligation is not affected by the fact that the obligation is itself secured by a transaction or interest to which this chapter does not apply.
  3. This chapter does not apply to the extent that:
    1. a statute, regulation, or treaty of the United States preempts this chapter; or
    2. the rights of a transferee beneficiary or nominated person under a letter of credit are independent and superior under § 4-5-114.
  4. This chapter does not apply to:
    1. a landlord's lien, other than an agricultural lien;
    2. a lien, other than an agricultural lien, given by statute or other rule of law for services or materials, but § 4-9-333 applies with respect to priority of the lien;
    3. an assignment of a claim for wages, salary, or other compensation of an employee;
    4. a sale of accounts, chattel paper, payment intangibles, or promissory notes as part of a sale of the business out of which they arose;
    5. an assignment of accounts, chattel paper, payment intangibles, or promissory notes which is for the purpose of collection only;
    6. an assignment of a right to payment under a contract to an assignee that is also obligated to perform under the contract;
    7. an assignment of a single account, payment intangible, or promissory note to an assignee in full or partial satisfaction of a preexisting indebtedness;
    8. a transfer of an interest in or an assignment of a claim under a policy of insurance, other than an assignment by or to a health-care provider of a health-care-insurance receivable and any subsequent assignment of the right to payment, but §§ 4-9-315 and 4-9-322 apply with respect to proceeds and priorities in proceeds;
    9. an assignment of a right represented by a judgment, other than a judgment taken on a right to payment that was collateral;
    10. a right of recoupment or set-off, but:
      1. Section 4-9-340 applies with respect to the effectiveness of rights of recoupment or set-off against deposit accounts; and
      2. Section 4-9-404 applies with respect to defenses or claims of an account debtor;
    11. the creation or transfer of an interest in or lien on real property, including a lease or rents thereunder, except to the extent that provision is made for:
      1. liens on real property in §§ 4-9-203 and 4-9-308;
      2. fixtures in § 4-9-334;
      3. fixture filings in §§ 4-9-501, 4-9-502, 4-9-512, 4-9-516, and 4-9-519; and
      4. security agreements covering personal and real property in § 4-9-604;
    12. an assignment of a claim arising in tort, other than a commercial tort claim, but §§ 4-9-315 and 4-9-322 apply with respect to proceeds and priorities in proceeds;
    13. an assignment of a deposit account in a consumer transaction, but §§ 4-9-315 and 4-9-322 apply with respect to proceeds and priorities in proceeds; or
    14. a transfer by a government or governmental unit.

History. Acts 2001, No. 1439, § 1; 2003, No. 204, § 1.

A.C.R.C. Notes. Acts 2003, No. 204, § 16, provided:

“Nothing in this act shall alter or diminish the Arkansas Public Service Commission's authority under otherwise applicable law.”

Research References

ALR.

Consignment Transactions Under Uniform Commercial Code Article 9 on Secured Transactions. 58 A.L.R.6th 289.

Remedies Available Under Revised U.C.C. § 9-625 for Secured Party's Failure to Comply with Article 9. 47 A.L.R.7th Art. 3 (2020).

Ark. L. Notes.

Laurence, Update: Some Practical Advice on How to Create a Security Interest in a Deposit Account, 2002 Arkansas L. Notes 45.

Case Notes

In General.

Former § 4-9-104 reinforces the conclusion that the law of Arkansas recognizes a mortgage of rent as a thing separate and distinct from a mortgage of land alone. First Fed. Sav. v. City Nat'l Bank, 87 B.R. 565 (W.D. Ark. 1988) (decision under prior law).

Applicability.

This section provides that the Uniform Commercial Code applies to conditional sales contracts and chattel mortgages and has the effect of relieving the court of the burden of construing instruments as either one or the other. United States v. Baptist Golden Age Home, 226 F. Supp. 892 (W.D. Ark. 1964) (decision under prior law).

This chapter, covering secured transactions, does not apply to real property or the creation of a real estate mortgage; it instead provides for the regulation of security interests in personal property and fixtures. Ark. Iron & Metal Co. v. First Nat'l Bank, 16 Ark. App. 245, 701 S.W.2d 380 (1985) (decision under prior law).

The pre-2001 version of this chapter, covering secured transactions, does not apply to real property or the creation of a real estate mortgage; it instead provides for the regulation of security interests in personal property and fixtures. Ark. Iron & Metal Co. v. First Nat'l Bank, 16 Ark. App. 245, 701 S.W.2d 380 (1985) (decision under prior law).

Where secured party chose to commence separate actions against the personal property collateral and the real property collateral of the guarantor, former subsection (j) was not applicable because personal property was also involved, and the secured party was required to act in accordance with the notice requirements of the pre-2001 version of the Arkansas Commercial Code. United States v. Dawson, 929 F.2d 1336 (8th Cir. 1991) (decision under prior law).

Article 9 of the Uniform Commercial Code applies to the filing and perfection of security interest in proceeds from farm crops and is not preempted by federal law. Nef v. Ag Servs. of Am., Inc., 79 Ark. App. 100, 86 S.W.3d 4 (2002).

Attachment Sales.

This chapter does not apply to attachment sales pursuant to a judgment, by virtue of this section and former § 4-9-104(h). Citizens Bank v. Perrin & Sons, 253 Ark. 639, 488 S.W.2d 14 (1972) (decision under prior law).

This chapter does not apply to attachment sales pursuant to a judgment, by virtue of former § 4-9-102(2) and this section. Citizens Bank v. Perrin & Sons, 253 Ark. 639, 488 S.W.2d 14 (1972) (decision under prior law).

Chattel Mortgages.

A chattel mortgage is a secured transaction within the meaning of this subtitle. Lonoke Production Credit Ass'n v. Bohannon, 238 Ark. 206, 379 S.W.2d 17 (1964) (decision under prior law).

A chattel mortgage, as between the parties, is a secured transaction within the meaning of the Uniform Commercial Code. Anderson v. First Jacksonville Bank, 243 Ark. 977, 423 S.W.2d 273 (1968) (decision under prior law).

Improvement Districts.

Because former subsection (e) of this section excepts from the operations of this chapter a transfer by a government or governmental subdivision or agency, this chapter is inapplicable to improvement districts. Quapaw Cent. Bus. Imp. Dist. v. Bond-Kinman, Inc., 315 Ark. 703, 870 S.W.2d 390 (1994) (decision under prior law).

Insurance.

Assignment of unearned premiums and dividends to insurance premium financing company was a transaction exempt from the filing requirements of the pre-2001 version of this chapter. Premium Fin. Specialists, Inc. v. Lindsey, 11 B.R. 135 (E.D. Ark. 1981) (decision under prior law).

Judgments and Causes of Action.

Section 16-65-120, which relates specifically to the sale and assignment of judgments and causes of action, was not impliedly repealed by enactment of former § 4-9-102 and was the applicable local law. Brown & Root, Inc. v. Hempstead County Sand & Gravel, Inc., 767 F.2d 464 (8th Cir. 1985) (decision under prior law).

Landlord's Liens.

A lien set out in a lease does not become a “landlord's lien” under this section by virtue of the fact that the relationship of landlord and tenant exists between the parties. In re King Furn. City, Inc., 240 F. Supp. 453 (E.D. Ark. 1965) (decision under prior law).

Former subsection (b) of this section specifically excludes landlord's liens. Herringer v. Mercantile Bank, 315 Ark. 218, 866 S.W.2d 390 (1993) (decision under prior law).

Notes Subsequent to Judgment.

Where judgment was obtained upon a note subsequent to its surrender by a bank which had held it as security for a loan, UCC did not apply after date of that judgment. McIlroy Bank v. First Nat'l Bank, 252 Ark. 558, 480 S.W.2d 127 (1972) (decision under prior law).

Secured Transactions.

Factors which distinguish a lease from a secured transaction include: (1) whether the financing agent is also a manufacturer or dealer; (2) whether a down payment is required; (3) whether the lessee must bear the risk of loss; (4) whether the lessee has an option to purchase at the end of the lease term and, if so, whether the purchase may be for little or no additional consideration; (5) whether the lessor, upon the lessee's default under the lease, has a right to declare all lease payments due and payable (similar to a mortgagee's foreclosure rights); (6) whether the lessee must pay sales taxes; (7) whether financing statements or additional security instruments are completed regarding the transaction; and (8) whether a sales price for the purchase was established at the outset of the lease. Thus agreement was not a lease, but a conditional sales contract and a secured transaction, where the agreement provided for a down payment at the start of the “lease”, the weekly payments included sales tax of approximately the current Arkansas sales tax rate, all risk of loss fell upon the “lessee”, the “lessee” was expressly provided an option to purchase which could be exercised only at a specific time, and, in the lease, the purchase price for the option was established at the outset, which precluded consideration of the actual fair market value of the television at the end of the term. In re Brown, 82 B.R. 68 (Bankr. W.D. Ark. 1987) (decision under prior law).

Cited: Bond v. Dudley, 244 Ark. 568, 426 S.W.2d 780 (1968); National Bedding & Furn. Indus., Inc. v. Clark, 252 Ark. 780, 481 S.W.2d 690 (1972); Rex Fin. Corp. v. Marshall, 406 F. Supp. 567 (W.D. Ark. 1976); Bell v. Itek Leasing Corp., 262 Ark. 22, 555 S.W.2d 1 (1977); Benton State Bank v. Warren, 263 Ark. 1, 562 S.W.2d 74 (1978); Bragg's Elec. Constr. Co. v. Rebsamen Cos., 6 B.R. 619 (Bankr. E.D. Ark. 1980); Womack v. Newman Fixture Co., 27 Ark. App. 117, 766 S.W.2d 949 (1989); Pachter, Gold & Schaffer v. Yantis, 742 F. Supp. 544 (W.D. Ark. 1990); Luker v. Reeves, 65 F.3d 670 (8th Cir. 1995) (decisions under prior law).

Notes of Decisions
Cited in 6 cases, 1990–2020 · leading case: Agrifund, LLC; & Hampton Pugh Co., LLC v. Regions Bank; Hill Seed & Elevator, Inc.;optimum Agric., LLC; & Hubbard Brake, LLC, 2020 Ark. 246 (Ark. 2020).
Sort: Relevance Newest Treatment
Agrifund, LLC; & Hampton Pugh Co., LLC v. Regions Bank; Hill Seed & Elevator, Inc.;optimum Agric., LLC; & Hubbard Brake, LLC, 2020 Ark. 246 (Ark. 2020). · cites it 2× “See Ark. Code Ann. § 4-9-109 (Supp. 2009). Optimum, on the other hand, holds an agricultural landlord’s lien.”
Lawhon Farm Supply, Inc. v. Hayes, 870 S.W.2d 729 (Ark. 1994). · cites it 2× “Crops are farm products under § 4-9-109(3) (Repl.1991). [4] The underlined portion represents the information filled in; the unlined portion represents the printed matter.”
Womack v. Newman Fixture Co., 785 S.W.2d 226 (Ark. Ct. App. 1990). · cites it 2× “§ 85-9-109(2) (Ark.Code Ann. § 4-9-109(2), just as the word "inventory" is defined in that statute (as the Hlass opinion noted).”
Beebe v. MacMillan Petroleum (Arkansas), Inc. (In Re MacMillan Petroleum (Arkansas), Inc.), 115 B.R. 175 (Bankr. W.D. Ark. 1990). · cites it 2× “Ark.Code Ann. § 4-9-109(4). Phillips’ affidavit presented no facts to support its artificial distinction between “the debtor’s rights in its inventory” and “the debtor’s inventory.”
Minor v. Chase Auto Fin. Corp., 372 S.W.3d 762 (Ark. 2010). · cites it 2× “…and therefore was not a secured transaction governed by Article 9 of the Uniform Commercial Code, as in this case. Ark.Code Ann. § 4-9-109 (Supp.2009).”
Duke Wholesale, Inc. v. Pitchford, 56 S.W.3d 399 (Ark. Ct. App. 2001). · cites it 2× “Arkansas Code Annotated section 4-9-109(4) (Repl. 1991) states that “goods are inventory if they are held by a person who holds them for sale or lease.”
— Ark. Code Ann. § 4-9-109(2) — 1 case
Womack v. Newman Fixture Co., 785 S.W.2d 226 (Ark. Ct. App. 1990). “§ 85-9-109(2) (Ark.Code Ann. § 4-9-109(2), just as the word "inventory" is defined in that statute (as the Hlass opinion noted).”
— Ark. Code Ann. § 4-9-109(3) — 1 case
Lawhon Farm Supply, Inc. v. Hayes, 870 S.W.2d 729 (Ark. 1994). “Crops are farm products under § 4-9-109(3) (Repl.1991). [4] The underlined portion represents the information filled in; the unlined portion represents the printed matter.”
— Ark. Code Ann. § 4-9-109(4) — 2 cases
Beebe v. MacMillan Petroleum (Arkansas), Inc. (In Re MacMillan Petroleum (Arkansas), Inc.), 115 B.R. 175 (Bankr. W.D. Ark. 1990). “Ark.Code Ann. § 4-9-109(4). Phillips’ affidavit presented no facts to support its artificial distinction between “the debtor’s rights in its inventory” and “the debtor’s inventory.”
Duke Wholesale, Inc. v. Pitchford, 56 S.W.3d 399 (Ark. Ct. App. 2001). “Arkansas Code Annotated section 4-9-109(4) (Repl. 1991) states that “goods are inventory if they are held by a person who holds them for sale or lease.”
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